A project initial investment is 250000 over an expected life

A project initial investment is $250,000 over an expected life of 4 years. Compute the OCF*that results in a zero NPV assuming an 18% discount rate.
a- $92,934.67 b- $94,927.01 c- $96,234.89 d- $99,826.11

Please show work

.?

Solution

Initial Investment = $250,000
Life of Project = 4 years
Discount Rate = 18%

NPV = -$250,000 + OCF * PVA of $1 (18%, 4)
0 = -$250,000 + OCF * (1 - (1/1.18)^4) / 0.18
0 = -$250,000 + OCF * 2.6901
$250,000 = OCF * 2.6901
OCF = $92,934.67

So, NPV will be zero at OCF of $92,934.67